HMRC explains why your tax code may change and what it means

Her Majesty's Revenue and Customs (HMRC) is the UK’s tax, payments and customs authority. It collects money that funds public services, and the amount people pay varies.

Each tax code tells your employer or pension provider how much Income Tax to deduct from your pay or pension. HMRC tells them which code to use, and you’ll have a separate tax code for each job or pension you receive - this means you could have more than one code at the same time.

Your tax code can change for reasons other than starting a new job. It could change if, for example, you start getting income from an additional job or pension, if your weekly State Pension amount changes, or if you need to repay the Winter Fuel Payment.

Not everyone will have a tax code - for example, if you’re fully self-employed, unemployed, or only receive the State Pension. You can find your tax code:

If you check your tax code online or in the HMRC app, you can also view your tax codes from previous tax years and opt in to paperless notifications. This means HMRC will email you whenever your tax code changes.

HMRC can change your tax code for several reasons, usually because your income or circumstances have changed and you need to pay a different amount of tax. If your tax code changes, they will usually contact you to explain how they calculated your new code.

If you start a new job and your employer does not yet have details of your previous income, you may be put on an emergency tax code. If your tax code has changed, you can use HMRC’s “Check your Income Tax” online service to find out why.

Money Saving Expert ( MSE ), founded by Martin Lewis , has urged people to act quickly, as some people may be more at risk of being on the wrong tax code. The financial experts note that while "anyone can be affected", there are some groups that may want to check sooner rather than later if one of the following situations has applied to you recently:

Tax codes are made up of numbers and letters. For most people with one job or pension, the current standard tax code is 1257L.

You can enter your code in the check what your tax code means tool here . This will tell you what the numbers and letters mean, how much tax you’ll pay and if you need to do anything.

The numbers in your tax code tell your employer or pension provider how much tax-free income you get from them in that tax year.

To work out your individual number, HMRC starts with your tax-free Personal Allowance and takes off any:

They then replace the final digit with a letter. However, if you have a K in your tax code the calculation is different.

HMRC's example explains: "You’re entitled to the standard tax-free Personal Allowance of £12,570, but you also get medical insurance from your employer. As this is a company benefit it lowers your Personal Allowance and changes your tax code.